v3.25.4

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Income Tax Disclosure [Abstract]

Schedule of Income (Loss) from Operations Before Income Taxes

The provision for income taxes is based on income before provision for income taxes as follows (in thousands):

			Year Ended December 31,
			2025						2024						2023
U.S.			$	1,571,743					$	401,760					$	1,084,254
Non-U.S.			92,708						(85,130)						(250,039)
Income before provision for income taxes			$	1,664,451					$	316,630					$	834,215

Schedule of (Benefit) Provision for Income Taxes

Our provision for income taxes consists of the following (in thousands):

			Year Ended December 31,
			2025						2024						2023
Current:
Federal			$	80,508					$	322,682					$	344,407
State			42,998						43,955						48,106
Foreign			6,610						2,931						3,001
			130,116						369,568						395,514
Deferred:
Federal			240,361						(106,549)						(139,468)
State			7,072						21,824						(19,625)
Foreign			252						(828)						195
			247,685						(85,553)						(158,898)
Total provision for income taxes			$	377,801					$	284,015					$	236,616

Schedule of Income Taxes Paid, Net of (Refunds) Received

Income taxes paid, net of (refunds) received, consisted of the following for the year ended December 31, 2025 (in thousands):

			Year Ended December 31,
			2025
Federal			$	178,100
State
Kentucky			20,798
Tennessee			(10,836)
All other states			19,345
Foreign			4,771
Total income taxes paid			$	212,178

Schedule of Reconciliation of Income Taxes at the U.S. Federal Statutory Rate to the (Benefit) Provision for Income Taxes

A reconciliation of income taxes at the U.S. federal statutory rate to the provision for income taxes is as follows (in thousands):

			Year Ended December 31, 2025
			$						%
U.S. federal statutory rate			$	349,535					21.0		%
State and local income taxes, net of federal benefit(1)			36,394						2.2		%
Foreign tax effects			(12,607)						(0.8)%
Effects of changes in tax laws or rates enacted in the current period			(49,289)						(3.0)		%
Effect of cross-border tax laws
Foreign-derived intangible income			(34,240)						(2.1)%
Tax Credits
Research and development tax credits			(59,998)						(3.6)%
Changes in valuation allowances			123,243						7.4%
Nontaxable or nondeductible items			13,528						0.8%
Changes in unrecognized tax benefits			14,208						0.9%
Other adjustments			(2,973)						(0.1)%
Effective income tax rate			$	377,801					22.7%

1 State taxes in Kentucky, California, and Delaware made up the majority (greater than 50%) of the tax effect in this category.

Our effective tax rate for the year ended December 31, 2025 was higher than the U.S. statutory rate primarily due to state income taxes and an increase in our valuation allowance against certain U.S. deferred tax assets. This was partially offset by tax rate benefits associated with research and development and orphan drug tax credit generations, the foreign derived intangible income deduction and the enactment of U.S. tax legislation discussed below.

As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the effective income tax rate differs from the U.S. statutory federal income tax rate as follows (in thousands):

									Year Ended December 31,
									2024						2023
Provision at U.S. federal statutory rate									$	66,492					$	175,185
State and local income taxes									51,753						21,145
Foreign tax rate differential									61,026						(96,434)
Income tax credits									(70,989)						(1,433,507)
Change in valuation allowance									21,425						1,572,951
Change in uncertain tax positions									6,418						5,943
Foreign-derived intangible income									(31,786)						(32,891)
Stock based compensation									25,647						20,971
Acquisitions accounted for as research and development expenses									149,287						4,200
Other									4,742						(947)
Provision for income taxes									$	284,015					$	236,616

Schedule of Significant Components of Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities are as follows (in thousands):

			December 31,
			2025						2024
Deferred tax assets:
Net operating loss carry forwards			$	304,075					$	315,969
Income tax credits			1,482,932						1,398,495
Capitalized research and development			554,454						648,989
Deferred revenue and accruals			96,463						190,446
Non-cash compensation			92,482						100,788
Acquisition-related contingent consideration			17,426						27,796
Intangibles, net			219,005						229,741
Long term investments			2,889						6,697
Other			24,582						20,814
Total gross deferred tax assets			2,794,308						2,939,735
Less valuation allowance for deferred tax assets			(2,266,136)						(2,139,673)
Net deferred tax assets			$	528,172					$	800,062
Deferred tax liabilities:
Property and equipment			$	(7,046)					$	(30,676)
Other			(5,832)						(7,315)
Total gross deferred tax liabilities			(12,878)						(37,991)
Net deferred tax assets			$	515,294					$	762,071

Schedule of Operating Loss Carryforwards

As of December 31, 2025, we had NOL carryforwards, research and development credit carryforwards and foreign income tax credit carryforwards as follows (in thousands):

			Amount						Expiring if not utilized
Net operating loss carryforwards
Federal			$	72,370					Indefinite
State			926,027						2027 through 2045; indefinite
Foreign			1,743,380						2026 through 2041; indefinite
Research and development credit carryforwards
Federal			$	9,431					2039 through 2044
State			14,310						2026 through 2043
Swiss income tax credit carryforwards			1,469,989						2028

Schedule of Unrecognized Tax Benefits

The following table summarizes the gross amounts of unrecognized tax benefits (in thousands):

			Year Ended December 31,
			2025						2024
Balance at beginning of year			$	87,723					$	69,145
Additions related to prior periods tax positions			3,539						9,173
Reductions related to prior periods tax positions			(2,226)						(2,014)
Additions related to current period tax positions			8,749						5,939
Additions related to acquisitions			—						9,114
Settlements			(24)						(71)
Reductions due to lapse of applicable statute of limitations			(333)						(3,538)
Currency translation adjustment			173						(25)
Balance at end of year			$	97,601					$	87,723

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